Stormont approached by St. Francis to take over assets

Stormont Vail Health will explore the feasibility of taking over St. Francis Health operations, a move that could save the jobs of 1,600 employees and help Topeka area patients maintain their health care.

Stormont CEO Randy Peterson said during a news conference late Tuesday that officials with SCL Health, the Denver-based owners of St. Francis, approached Stormont on Monday to ask if it would assume the assets and take over operations.

“We haven’t quite had 24 hours to think about that, but our deliberation around that is how we’re going to take care of the health care needs in the community and the region,” Peterson said. “We would need the facilities and the staff of St. Francis to be able to do that. So we have said to SCL that we are interested in that prospect, and we would move forward with a confidentiality agreement and do our due diligence to see what that possibility might be.”

Within the next few days, the two hospitals will enter into the confidentiality agreement, which will allow Stormont access to financial and other information necessary to determine the future of St. Francis, Peterson said.

Earlier Tuesday, SCL Health CEO Mike Slubowski said St. Francis will either sell or close by summer and he indicated that SCL Health would be willing to donate the facility and equipment. He also alluded to negotiations with Stormont.

“We’ve had good open discussions with Randy and the Stormont team,” he said. “Stormont could possibly be a part of the solution here. We’re keeping an open mind and so are they.”

Although Peterson couldn’t indicate how long it will take Stormont to determine a course forward, he pointed out that SCL Health has made it clear it intends to end its work at St. Francis by summer. To complete an agreement between the two hospitals by then would be an “expedited” process.

“I won’t say that that wouldn’t be a real challenge,” he said, adding that when he led the merger of two hospitals in Salina in 1995, it took 12 months to develop a transition plan.

“We certainly would commit to that because if they’re going to leave this summer, we have to be in a position with staffing and facilities to be able to take care of those patients,” Peterson said.

Peterson said Stormont staff has been making plans should St. Francis close, considering how best they could meet medical needs in the community. They’ve discussed possible expansion of express care facilities to take some of the load off of the emergency room, and also reached out to regional hospitals to see how they could help meet the needs of Topeka-area patients, he said. A smooth transition is the foremost goal.

“It’s hard to create ICU beds and Med/Surg (Medical/Surgical) beds in a short period of time. That would be our challenge, is how we can best take care of those kind of patients, and some of the trauma patients,” he said.

Peterson committed to being as open about the process as he can be, given the confidentiality agreement. Before calling the Tuesday news conference, he sent an internal communication to Stormont employees to let them know that Stormont would explore the process of acquiring St. Francis.

Slubowski and other SCL Health officials reached out to St. Francis associates all day Tuesday, holding staff meetings that imparted the message that hope isn’t lost.

“We’re being optimistic but also realistic,” he said.

Those words highlighted the dilemma St. Francis associates are facing after the 107-year-old Topeka hospital went on the chopping block last year. As no sale was announced in intervening months, tensions rose and concerns about closure escalated, but most want to believe there is a solution.

However, many left Tuesday staff meetings held by SCL Health to update staff members feeling as if finding a buyer is unlikely.

“It’s very challenging, obviously, to make something like this happen in a short period of time,” Slubowski said. “However, we did a number of meetings with state, local and county government, and other providers, in the last two days, and I think there is more of a unified sense of urgency to try to find a solution. So I’m keeping the faith, but I’m also being realistic.”

Slubowski refused to speculate on what state and local officials could do to bolster a St. Francis sale. But he pointed to other transactions nationwide where economic development incentives like tax credits were offered, or even where payers like Blue Cross and Blue Shield offered incentives.

Matt Pivarnik, president and CEO of the Greater Topeka Chamber of Commerce and GO Topeka, said he felt a “glimmer” of hope after meeting with SCL officials.

“Based on the conversations we have had over the last several days, we are hopeful we can create a solution, which minimizes the disruption to the patients and employees at St. Francis Health,” he said. “We will continue to work tirelessly with providers in Topeka, including our partners at Stormont Vail Health, as well as, the city, county and state government and our business leaders to see this solution come to fruition.”

The inability to tell associates what was happening was primarily because of confidentiality rules put in place by companies that were considering purchasing St. Francis, Slubowski said.

“We told our associates that we will be as transparent as we can be, and we will give them as much information in the interim as we can,” he said, adding that the St. Francis board of directors and CEO David Setchel would reach out to employees as the situation changes.

But by the first week of May, SCL Health officials will return to Topeka to make a decision, he said.